Secretary of Commerce Gutierrez's Upcoming Trip to Mexico and Efforts to Promote Free Trade, Economic Growth and Security in the Western Hemisphere

SECRETARY GUTIERREZ: Buenos dias and thank you for your interest. We're leaving for Mexico City this afternoon. I'm looking forward very much to my trip to Mexico. And we have, as you well know, a very important commercial relationship with Mexico. Our two-way trade is about $300 billion. The U.S. direct investment in Mexico is over $70 billion.

So it is an extremely important commercial relationship and I'm focusing on the commercial side because that's what I do. And the whole purpose of the trip is to discuss ways where we can make it even stronger and more -- even more beneficial to people and workers and consumers in the United States and Mexico.

We announced this morning our GDP growth numbers for the fourth quarter, remarkable. Again, once again, we see that we have a very strong economy, 3.5 percent growth for the quarter. And one of the highlights to that, that is very important to note, is that a big driver of our growth was our trade, so our exports added to our GDP growth added a confirmation of the policies that President Bush is pursuing and that I understand that President Calderon has announced and is pursuing very aggressively, which is to create an environment that attracts investment, that attracts capital, that attracts job-creating opportunities for our citizens.

So I'm looking forward to the trip and it is an extremely important relationship, one that we value very highly, and looking forward to getting on the plane and going to Mexico City. So thank you for your interest. We'll open it up.

QUESTION: Nestor Ikeda, AP. Secretary, is this your first trip during the Calderon administration? Is that correct?

SECRETARY GUTIERREZ: My first --

QUESTION: Trip to Mexico.

SECRETARY GUTIERREZ: My -- well, I was there for the inauguration, so this would be my second official trip.

QUESTION: Ruben Barrera, NOTIMEX. Mr. Secretary, what would you say are the areas where you think the relationship between both countries goes -- comes stronger? And I wonder if -- I mean, you're going to discuss with President Calderon and the Secretary of Commerce of Mexico any specific plans to increase this relationship.

SECRETARY GUTIERREZ: We're going to talk on -- in general terms, our respective strategies for continuing to make our environment attractive to foreign investment, attractive to local investment, attractive to entrepreneurs, attractive to opportunities to create jobs. We have something we call the SPP, the Security and Prosperity Partnership. I believe in Mexico, it's the ASPAN, (in Spanish).

And the whole idea is to take all of the progress we've made during NAFTA and to see what opportunities there are to make even more progress. And these are very practical, very common sense things. We know that in some industries that we are still doing three different testing procedures in Canada and the U.S. and Mexico. Perhaps we could have one and that will make it more efficient, so -- looking for ways in specific industries and to take the next step and make our relationship more efficient, more effective within the context of NAFTA.

So this is not new legislation, this is not a strategic shift of what NAFTA is. It just -- it takes what we have and tries to look for opportunities to make it even more efficient and effective. So that will be the foundation and -- that we'll be discussing.

We have -- very importantly, in June, in Atlanta, we have the Western Hemisphere Competitiveness Forum, which is designed to bring countries from private sector, public sector from the Western Hemisphere and talk about ways that we can become even more competitive, understanding that this is a very competitive world and that as a hemisphere, we are competing with countries from all over the world. And that will be a very important way of sharing experiences, sharing lessons, and Mexico will have a lot to contribute to a competitiveness forum.

QUESTION: Mr. Secretary, Nestor Ikeda from Associated Press. I understand one of the key issues in the trade relation with Mexico is the -- is to get a point of secure trade. And as you know, recently, the -- President Calderon was immersed in doing something against the crime and organized crime in the borders. So how do you feel those -- Mexico's administration measures could add to this to get this goal in the border?

SECRETARY GUTIERREZ: Well, it's a good point. The -- our SPP is Security and Prosperity Partnership, so it recognizes that security and prosperity go hand in hand and that in order to increase investment, increase trade flows, increase jobs, that we have to have a secure environment.

The security part is overseen by Secretary Chertoff and the Department of Homeland Security, but there's no question that those two are very linked and we know that President Calderon and President Bush are -- and Prime Minister Harper are committed to doing everything possible to have the most secure environment within the North American sphere and the Western Hemisphere so that we can get on with the business of creating jobs and creating prosperity and improving the well-being of our citizens in the three countries.

QUESTION: On immigration -- I am Adriana with Reuters. President Calderon has said that investment is key to controlled immigration flow into the United States. Is immigration something that you're going to discuss?

SECRETARY GUTIERREZ: It will most likely be, because it is something that affects both countries. I'm sure it will come up in discussions, probably get a couple of questions, and I will communicate that we are, as the President mentioned in the State of the Union Address, we are looking at a comprehensive immigration reform initiative that starts with having secure borders to the point of security goes hand in hand with prosperity to having a temporary workers permit to having a way of ensuring that we can have a way to fill our labor needs while continuing to be a secure country with secure borders.

So we're working with Congress and I'm sure they know that, but I'll update them on these matters, which is what I can do in my position. So I will be updating them on what we're doing, although I'm sure they know.

QUESTION: And on the wall that will be built?

SECRETARY GUTIERREZ: Let me just -- I'll say a couple things about that. Three things. One is my understanding, it's a fence although people call it a wall.

QUESTION: Physical barrier.

SECRETARY GUTIERREZ: The other thing is, you know, I think that every country in the world, every country, has the obligation and the right to know who comes in and who leaves. And it's not just physical borders; it's airports and marine ports and there's the northern border and the southern border. And based on that goal, what the consensus was is that the way to achieve that was by adding personnel, by adding technology, and by extending the fence. So the experts have reached a consensus that there are a lot of different things that need to be done to have a secure border, and so it's a very practical logistics activity and I would hope that we could look at it that way and not read into the symbolism but simply see it as a way of guaranteeing that we know who's coming into the country and who isn't.

We have to remember that it was five years ago that we went through September 11th. That is a memory that's very deep in Americans' minds and we want to ensure that the people who come to work can come to work and ensure that those who want to come into our country to do us harm do not come in. And you know, we'd like to work in the spirit of partnership with Mexico on that.

QUESTION: (Inaudible) inauguration (inaudible) a couple of weeks ago. Didn't you have the feeling that a good trade relationship (inaudible) country?

SECRETARY GUTIERREZ: Well, we have significant investment in Ecuador. I say we; American companies do. Our preferences, the trade preferences that we have with Ecuador, generate -- I'm speaking from memory here, but I believe the number that I cited in Ecuador was 150,000 jobs. And then our foreign investment, our direct investment in the country, also creates jobs. So we are Ecuador's number one customer and we value that relationship. I believe that makes it a very important relationship. And as I mentioned in Ecuador, we'd like to work hard to continue to make that relationship beneficial and for both countries and continue to demonstrate results, create jobs, create growth, contribute to the prosperity of both countries.

QUESTION: Do you support the expansion of the trade preferences?

SECRETARY GUTIERREZ: That's something that Congress has to decide. We want to work with Congress and it's something that we're going to have to deal with. We also want to work with President Correa, Correa's administration. So we'll to work on that. That's something that's pending and will come up. It's a decision that will have to go to the Congress.

QUESTION: Lourdes Heredia from the BBC. What about the fast track? There's been, you know, a kind of thing that the White House is going to ask for it and when. Can you explain to me what is going on there?

SECRETARY GUTIERREZ: Well, the President, I believe, talked about trade promotion authority yesterday and he'll be making a speech today about the economy. And as I've said when I was asked this question a couple of weeks ago, it's important for the President to have trade promotion authority. It's important for every president to have trade promotion authority, especially at a time when we are seeing how important trade is and we are seeing the benefits of exports to our economy. You know, our exports last year grew 13 percent. The previous year they grew almost 11 percent. The average growth since the President came to office is about 6 percent.

What those numbers tell me is that all of the free trade agreements that have been put in place during President Bush's time in office are gaining momentum, are generating results. And they have been a very positive step toward growing our economy and engaging the world and increasing trade flows. We have free trade agreements with 7 percent of the world's economy, but we do 40 percent of our exports with those countries. So there's no question that these trade agreements are adding to our economy, are adding to job creation, are adding to growth. And the President should have the authority to continue in that direction. This is not a time -- this is not the time, especially with these numbers, it's not the time to go back.

The other very important aspect is the multilateral WTO talks that are going on today. The Doha round is very important in terms of creating jobs throughout the world. And it's extremely important that the President have the authority to continue to engage in those discussions and come to an agreement.

QUESTION: But some Democrats in the Congress, they don't think (inaudible). I mean, they think that the trade is just, you know, good for some people, not for everyone. So do you think that he actually can get the fast track as it is right now, or he will have to compromise, the President will have to compromise to get a kind of a fast track?

SECRETARY GUTIERREZ: I'm not going to speculate. I will just say it is extremely important, especially, especially if we look at the results of trade. And you don't have to look beyond today's GDP numbers today, 3.5 percent growth driven primarily by exports. We are creating jobs, we are growing; it is contributing to our economy. This is not the time to change and go back. So it's very important. The President should have the authority and we're going to work very hard to ensure that he does.

QUESTION: But why so important the fast track (inaudible) cases like Peru or Colombia that they are ready, the trade agreements are ready, they've been signed, they've been everything, (inaudible) fast track (inaudible), and nothing has happened. So what is the (inaudible) thing about the fast track (inaudible)?

SECRETARY GUTIERREZ: Peru and Colombia and Panama are important agreements that are pending, and at the right time they will be taken forward. But those are very important agreements and that's all part of our trade plan and all part of moving forward and all part of continuing to engage the world in trade, continuing to create jobs. So Peru, Colombia and Panama will have their moment, their time. Those are very important agreements.

QUESTION: So you really think that the Congress, even in Democrats' hands, will pass this?

SECRETARY GUTIERREZ: Because I know that they are important and beneficial and the right thing for our country, yes, I believe that we will do the right thing.

QUESTION: So he's asking today for the fast track (inaudible)?

SECRETARY GUTIERREZ: You'll have to watch the President's speech. I mean --

QUESTION: Mr. Secretary, Ruben Barrera from Notimex, Mexico. Going back to the issue of your trip to Mexico, you talk about the (inaudible) of direct investment, U.S. direct investment in Mexico and my colleague Nestor Ikeda talks about (inaudible) these new measures that the Calderon government has implemented in order to face the increasing violence and increase operation like drug cartels and crime organizations. And in wonder if in your contacts with the investment community here in the United States you have a sense of, you know, what is the -- how the investment community is seeing what's going on in Mexico in terms of security. I mean, do they worry in any way that, you know, this violence could increase? And if that's the case, I mean, what is the point that -- or in which point these (inaudible) could, you know, wonder if it is still -- if it's a good -- good to invest me Mexico when we have all this violence across the country.

SECRETARY GUTIERREZ: Well, those are decisions that are made by individual investors and individual businesses. I don't have the number here, but I believe that investment in Mexico is growing or has grown. Do we have that? So that's -- those are the results. There is no question that investors throughout the world look for a safe environment for their investment. They look for a secure environment. And that applies to Mexico, it applies to the U.S., it applies to Canada and it applies to the whole world. We know and we have seen that President Calderon has shown a great deal of courage and determination to ensure that Mexico has a secure environment and we want to be good partners in that quest.

Let me give you some numbers. Foreign direct investment in Mexico in 2004 -- these are cumulative numbers -- 63.5 billion. In 2005 it grew to 71.4 billion. So that difference is the growth in investment. So there is more investment flowing into Mexico and the important thing is to ensure that investors continue to believe that it is a safe environment and it is a secure environment and we applaud the steps that President Calderon has taken to ensure that his country is secure, safe, so that we can go about -- all of us -- the task of creating jobs, creating growth, creating prosperity.

QUESTION: I'm Antonio Rodriguez with AFP. Do you have any comment on the last appearance of Mr. Fidel Castro yesterday night on TV with Hugo Chavez?

SECRETARY GUTIERREZ: No. I didn't see -- I saw part of it. I noticed it came up on the screen and I haven't really looked at it in detail. Sorry.

QUESTION: The fact that he was with Hugo Chavez yesterday, no comment?

SECRETARY GUTIERREZ: It's not the first time they've been together. I've seen them together before. They'll probably be together in the future.

QUESTION: Mr. Secretary, what do you make of this proposal in Miami to have a party after Fidel Castro dies? There was some reaction yesterday. Some people say it's a bad idea, some people say that it sends a negative image from the Cuban community (inaudible) to the rest of the world.

SECRETARY GUTIERREZ: I saw a story. I saw a headline this morning. I understand that that's being debated in Miami and the local authorities are involved in that debate. I think the important thing is that we stay focused on the plight of Cubans in Cuba and the fact that they have been denied fundamental human rights for so long and we want them to be able to choose and determine their future. It is their country. The future of Cuba lies in Cuba among Cubans, and there's still a lot of work that they need to do to be able to reach the point where political prisoners are free, where people can talk without the fear of being persecuted, where people can open a small business, have a dream of having a more prosperous life. So that's the focus is the future and the fact that the people in Cuba are not free. That's what I think about it.

MODERATOR: Time for two more questions.

QUESTION: Just a follow-up on Cuba. If there is a compromise of a new government in Cuba for a transition to democracy, how long would it take for the U.S. to rebuild the country?

SECRETARY GUTIERREZ: Well, Cuba will be -- Cuba is a sovereign country, so the premise of the question of how long will it take the U.S. to rebuild Cuba -- it's up to Cubans. You know, Cubans will have to decide their future and part of that is would they like the U.S. to help them rebuild. And we of course are willing and ready to be friends and partners in a free and democratic Cuba if the Cubans so desire, but those decisions will have to be made in Cuba by Cubans.

QUESTION: Mr. Secretary, Jose Diaz from Reforma newspaper from Mexico. Have you received anything from the Calderon administration whether they would change their policy regarding the regulation in the telecommunications industry and the TV industry? While we know that there are monopolies -- well, almost monopolies operating there. Do you see -- do you expect any change? Would you like to see effort to get national TV, you know, changed in Mexico?

SECRETARY GUTIERREZ: Well, I won't get into specific industries and I will know a lot more about the environment after my trip. I would just say that a general statement is that competition is good. Competition works. Competition is good for the economy, it's good for jobs, it's good for consumers. So we always believe that a competitive environment is good for the economy.

QUESTION: Thank you very much.

QUESTION: Can I just ask how long the trip is? When will you be coming back?